Gold has been in a bull market for past 12 years since touching down near $250 per ounce in 2001. Wars, global instability, low interest rates and highly stimulative monetary policy combined to form a potent bullish cocktail that has helped push the yellow metal more than 650% higher through its 2011 high of $1,920 per ounce. After sliding 20% from that peak, gold staged rallies back to $1,800 in February and October last year, but has drifted lower for most of the past four months, now trading below $1,600 per ounce.

Pessimism surrounding gold has been thick, and from a contrarian perspective, that's bullish. Just when everybody is loudly proclaiming the end of gold's long bull run, it's probably not a bad idea to take the other side of that bet. Fears that the Federal Reserve will raise interest rates or scale back its $85 billion montly pace of asset purchases have been to blame for gold's recent weakness, along with high-profile selling in the SPDR Gold Trust by people like George Soros. With gold and gold stocks due for at least a bounce from deeply oversold conditions, now may be a good time to establish a position in a mining stock with a decent dividend.

Big dog Barrick Gold (ABX) yields 2.7%, while both Goldcorp (GG) and South Africa's Gold Fields (GFI) are good for 1.8%. You get a fatter yield in small cap Gold Resources (GORO), but the better idea may be to stick with a well-known name where the top three officers are not related.

Denver-based Newmont Mining is the world's third largest gold miner, with operations in the U.S., Australia, Peru, Indonesia, Ghana, New Zealand and Mexico. In 2012 it produced 5 million ounces of gold and 143 million pounds of copper, and it forecasts production of 4.8 million to 5.1 million ounces of gold this year, with 150 million to 170 million pounds of copper. Analysts expect earnings of $4.32 per share in 2013, up from $3.71 last year. Revenue is expected to rise 7% to $10.56 billion.

Newmont's dividends are linked to the average price of gold for the quarter they're declared. Last quarter, the avearge price of gold was $1,719, resulting in a payout of $0.425 per share. That rate will apply when the average price exceeds $1,700. If the price is above $1,600 per ounce of gold, the payout is $0.35, and it's $0.30 for prices above $1,500, with a reduction of five cents for every subsequent $100 decrease in the gold price. The first two months of this quarter have seen average prices below $1,700, making the likely payout $0.35, which would still produce a yield of 3.44%.

With a commodity producer like Newmont, the value of the company is certainly tied to the price of what the company produces, and multiples also fluctuate. Over the past three years, however, Newmont has traded at an average price-sales ratio of 3.02, which would correspond to a $60 stock price based on last year's revenue. As with all positions, but especially with more volatile stocks like mining companies, be mindful of risk managent and place a stop-loss order in line with your risk tolerance. I suggest an 7% to 8% trailing stop.